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Do the libtards understand what it means"To lead by example". I thought they believed its better to spend OPM (other peoples money) instead of your own. You know"Share the wealth". Or was that share other peoples wealth?

Sounds like?

Sounds like somebody has a thing against Krugman. .

The Real Story

By PAUL KRUGMAN

Next week, President Obama is scheduled to propose new measures to boost the economy. I hope they’re bold and substantive, since the Republicans will oppose him regardless — if he came out for motherhood, the G. O. P. would declare motherhood un-American. So he should put them on the spot for standing in the way of real action.

But let’s put politics aside and talk about what we’ve actually learned about economic policy over the past 20 months.

When Mr. Obama first proposed $800 billion in fiscal stimulus, there were two groups of critics. Both argued that unemployment would stay high — but for very different reasons.

One group — the group that got almost all the attention — declared that the stimulus was much too large, and would lead to disaster. If you were, say, reading The Wall Street Journal’s opinion pages in early 2009, you would have been repeatedly informed that the Obama plan would lead to skyrocketing interest rates and soaring inflation.

The other group, which included yours truly, warned that the plan was much too small given the economic forecasts then available. As I pointed out in February 2009, the Congressional Budget Office was predicting a $2. 9 trillion hole in the economy over the next two years; an $800 billion program, partly consisting of tax cuts that would have happened anyway, just wasn’t up to the task of filling that hole.

Critics in the second camp were particularly worried about what would happen this year, since the stimulus would have its maximum effect on growth in late 2009 then gradually fade out. Last year, many of us were already warning that the economy might stall in the second half of 2010.

So what actually happened? The administration’s optimistic forecast was wrong, but which group of pessimists was right about the reasons for that error?

Start with interest rates. Those who said the stimulus was too big predicted sharply rising rates. When rates rose in early 2009, The Wall Street Journal published an editorial titled “The Bond Vigilantes: The disciplinarians of U. S. policy makers return. ” The editorial declared that it was all about fear of deficits, and concluded, “When in doubt, bet on the markets. ”

But those who said the stimulus was too small argued that temporary deficits weren’t a problem as long as the economy remained depressed; we were awash in savings with nowhere to go. Interest rates, we said, would fluctuate with optimism or pessimism about future growth, not with government borrowing.

When in doubt, bet on the markets. The 10-year bond rate was over 3. 7 percent when The Journal published that editorial; it’s under 2. 7 percent now.

What about inflation? Amid the inflation hysteria of early 2009, the inadequate-stimulus critics pointed out that inflation always falls during sustained periods of high unemployment, and that this time should be no different. Sure enough, key measures of inflation have fallen from more than 2 percent before the economic crisis to 1 percent or less now, and Japanese-style deflation is looking like a real possibility.

Meanwhile, the timing of recent economic growth strongly supports the notion that stimulus does, indeed, boost the economy: growth accelerated last year, as the stimulus reached its predicted peak impact, but has fallen off — just as some of us feared — as the stimulus has faded.

Oh, and don’t tell me that Germany proves that austerity, not stimulus, is the way to go. Germany actually did quite a lot of stimulus — the austerity is all in the future. Also, it never had a housing bubble that burst. And with all that, German G. D. P. is still further below its precrisis peak than American G. D. P. True, Germany has done better in terms of employment — but that’s because strong unions and government policy have prevented American-style mass layoffs.

The actual lessons of 2009-2010, then, are that scare stories about stimulus are wrong, and that stimulus works when it is applied. But it wasn’t applied on a sufficient scale. And we need another round.

I know that getting that round is unlikely: Republicans and conservative Democrats won’t stand for it. And if, as expected, the G. O. P. wins big in November, this will be widely regarded as a vindication of the anti-stimulus position. Mr. Obama, we’ll be told, moved too far to the left, and his Keynesian economic doctrine was proved wrong.

But politics determines who has the power, not who has the truth. The economic theory behind the Obama stimulus has passed the test of recent events with flying colors; unfortunately, Mr. Obama, for whatever reason — yes, I’m aware that there were political constraints — initially offered a plan that was much too cautious given the scale of the economy’s problems.

So, as I said, here’s hoping that Mr. Obama goes big next week. If he does, he’ll have the facts on his side.

When Mr. Obama first proposed $800 billion in fiscal stimulus, there were two groups of critics. Both argued that unemployment would stay high — but for very different reasons.

One group — the group that got almost all the attention — declared that the stimulus was much too large, and would lead to disaster. If you were, say, reading The Wall Street Journal’s opinion pages in early 2009, you would have been repeatedly informed that the Obama plan would lead to skyrocketing interest rates and soaring inflation.

The other group, which included yours truly, warned that the plan was much too small given the economic forecasts then available. As I pointed out in February 2009, the Congressional Budget Office was predicting a $2. 9 trillion hole in the economy over the next two years; an $800 billion program, partly consisting of tax cuts that would have happened anyway, just wasn’t up to the task of filling that hole.

Krugman completely ignores the third group that correctly claimed government miss-allocation of scarce resources would result in increased unemployment and a stagnant economy. Another complete miss for Krugman.

So what actually happened? The administration’s optimistic forecast was wrong, but which group of pessimists was right about the reasons for that error?

The third group, which Krugman pretends doesn't exist.

But those who said the stimulus was too small argued that temporary deficits weren’t a problem as long as the economy remained depressed; we were awash in savings with nowhere to go. Interest rates, we said, would fluctuate with optimism or pessimism about future growth, not with government borrowing.

But the deficits are not temporary in the normal use of the word. Sure, plane Earth and our Sun are temporary. The entire Universe may be "temporary" as far as I know. If Krugman has his way, our government deficits will never disappear. If more rational thinking prevails, deficits will only disappear after our economic system is rebuilt, based on sound money and free market capitalism.

What about inflation? Amid the inflation hysteria of early 2009, the inadequate-stimulus critics pointed out that inflation always falls during sustained periods of high unemployment, and that this time should be no different.

So Krugman claims to be an economist, but he is unaware of Carter's Stagflation; high unemployment and high inflation? Hello, time to wake up.

Sure enough, key measures of inflation have fallen from more than 2 percent before the economic crisis to 1 percent or less now, and Japanese-style deflation is looking like a real possibility.

Krugman doesn't know what inflation is. Inflation is an increase in the money supply. Inflation causes prices to rise, but there is usually a delay; commonly a year to 18 months. By "inflation" Krugman really means "CPI. " But he is using government statistics and the government lies and under-reports the CPI just as it does unemployment. Notice the CPI went up after Obama's budget busting stimulus spending.

Meanwhile, the timing of recent economic growth strongly supports the notion that stimulus does, indeed, boost the economy: growth accelerated last year, as the stimulus reached its predicted peak impact, but has fallen off — just as some of us feared — as the stimulus has faded.

Here, Krugman confused growth and spending. Government spent more money and therefore, more money was spent. But we are still waiting for growth, which depends on capital investment, which depends on savings, not spending.

The actual lessons of 2009-2010, then, are that scare stories about stimulus are wrong, and that stimulus works when it is applied. But it wasn’t applied on a sufficient scale. And we need another round.

I know that getting that round is unlikely: Republicans and conservative Democrats won’t stand for it. And if, as expected, the G. O. P. wins big in November, this will be widely regarded as a vindication of the anti-stimulus position. Mr. Obama, we’ll be told, moved too far to the left, and his Keynesian economic doctrine was proved wrong.

But politics determines who has the power, not who has the truth. The economic theory behind the Obama stimulus has passed the test of recent events with flying colors; unfortunately, Mr. Obama, for whatever reason — yes, I’m aware that there were political constraints — initially offered a plan that was much too cautious given the scale of the economy’s problems.

So, as I said, here’s hoping that Mr. Obama goes big next week. If he does, he’ll have the facts on his side.

Krugman continues to ignore the facts of the 1920 recession, which lasted only two years because the government cut taxes and spending. He also continues to ignore the massive spending and deficits of Hoover and FDR which turned a recession into a decade long depression. Krugman has no problem with the facts. He just ignores them and doesn't let them bother him. He sleeps well, I'm sure.

Eh, not the man, just the ideology, economic theory and idiocy of his "brilliance. "

He contradicts himself more times than not, thinks that the government is the creator of wealth and debt is good, savings is dumb and so many other fallacies that I can't keep up with them all. Not to mention some of the people who comment on his blog have dis-proven his theories time and again and what does he do? Censor them.

Between him and Robert Reich, I don't know which is worst. Reich's latest piece I believe takes the cake.

Krugman completely ignores the third group that correctly claimed government miss-allocation of scarce resources would result in increased unemployment and a stagnant economy. Another complete miss for Krugman.

The third group, which Krugman pretends doesn't exist.

But the deficits are not temporary in the normal use of the word. Sure, plane Earth and our Sun are temporary. The entire Universe may be "temporary" as far as I know. If Krugman has his way, our government deficits will never disappear. If more rational thinking prevails, deficits will only disappear after our economic system is rebuilt, based on sound money and free market capitalism.

So Krugman claims to be an economist, but he is unaware of Carter's Stagflation; high unemployment and high inflation? Hello, time to wake up.

Krugman doesn't know what inflation is. Inflation is an increase in the money supply. Inflation causes prices to rise, but there is usually a delay; commonly a year to 18 months. By "inflation" Krugman really means "CPI. " But he is using government statistics and the government lies and under-reports the CPI just as it does unemployment. Notice the CPI went up after Obama's budget busting stimulus spending.

Here, Krugman confused growth and spending. Government spent more money and therefore, more money was spent. But we are still waiting for growth, which depends on capital investment, which depends on savings, not spending.

Krugman continues to ignore the facts of the 1920 recession, which lasted only two years because the government cut taxes and spending. He also continues to ignore the massive spending and deficits of Hoover and FDR which turned a recession into a decade long depression. Krugman has no problem with the facts. He just ignores them and doesn't let them bother him. He sleeps well, I'm sure.

Not to mention that he always falls back on FDR and the 1930's and 40's as proof of his theories without ever proving them.

The problem with rebutting a snowflake cut-&-paste by krugman is that neither krugman nor snowflake engage. krugman has been butchered within his own blog on the few times he's addressed challenges posed by posters to his blog. He's retreated to rationalizing intellectual indifference rather than slugging out the merits of his arguments for fear of losing his stature among liberal sycophants. He's supported in his media by this, knowing full well it would leave no one for the snowflakes to parrot.

off topic; it just occurred to me snowflake, that you're living a lie claiming yourself as a snowflake. Snowflakes are supposed to be unique. . . each one completely different. You've failed to give an accounting of yourself which measures up. You've only duplicated what others put forth, much like something that comes out of a cookie-cutter. It's true you may have more nuts the average cookie, but just the same, you're a cookie out of the same mold as the rest.

In addition, Krugman is ignorant, willfully or otherwise, of the causes and effects of the economic policies of the 1920's and 1930's. They only reason the Depression didn't continue on into the 1940's is WWII. Without the nationwide sacrifice (on top of 15 years of bleak) and sole-purpose war effort the Depression would have marched on unabated due to poor policies in Washington.

Krugman refuses to see the real and the historical cause(s) and effect(s) (not just those seen here in the U. S. but also abroad). He is subscribing to a failed set of theories that have been proven incorrect over and over. He claims the opposition is "more wrong" than him, thus proving him correct, however, he forgets that the halfarsed-capitalists are not the only opposition to his disproven dogma.

Between him and Robert Reich, I don't know which is worst. Reich's latest piece I believe takes the cake.

Reich is so full of himself and full of grandiose delusions of intellect that he makes Ed Gein look like Mohandas Ghandi. That sawed-off twirp doesn't understand economics because is not even tall enough to see the documents, that plainly prove him wrong, that are sitting on the table in front of him.

Really?

Originally Posted by CBlack

Not to mention that he always falls back on FDR and the 1930's and 40's as proof of his theories without ever proving them.

September 5, 2010

1938 in 2010

By PAUL KRUGMAN

Here’s the situation: The U. S. economy has been crippled by a financial crisis. The president’s policies have limited the damage, but they were too cautious, and unemployment remains disastrously high. More action is clearly needed. Yet the public has soured on government activism, and seems poised to deal Democrats a severe defeat in the midterm elections.

The president in question is Franklin Delano Roosevelt; the year is 1938. Within a few years, of course, the Great Depression was over. But it’s both instructive and discouraging to look at the state of America circa 1938 — instructive because the nature of the recovery that followed refutes the arguments dominating today’s public debate, discouraging because it’s hard to see anything like the miracle of the 1940s happening again.

Now, we weren’t supposed to find ourselves replaying the late 1930s. President Obama’s economists promised not to repeat the mistakes of 1937, when F. D. R. pulled back fiscal stimulus too soon. But by making his program too small and too short-lived, Mr. Obama did just that: the stimulus raised growth while it lasted, but it made only a small dent in unemployment — and now it’s fading out.

And just as some of us feared, the inadequacy of the administration’s initial economic plan has landed it — and the nation — in a political trap. More stimulus is desperately needed, but in the public’s eyes the failure of the initial program to deliver a convincing recovery has discredited government action to create jobs.

In short, welcome to 1938.

The story of 1937, of F. D. R. ’s disastrous decision to heed those who said that it was time to slash the deficit, is well known. What’s less well known is the extent to which the public drew the wrong conclusions from the recession that followed: far from calling for a resumption of New Deal programs, voters lost faith in fiscal expansion.

Consider Gallup polling from March 1938. Asked whether government spending should be increased to fight the slump, 63 percent of those polled said no. Asked whether it would be better to increase spending or to cut business taxes, only 15 percent favored spending; 63 percent favored tax cuts. And the 1938 election was a disaster for the Democrats, who lost 70 seats in the House and seven in the Senate.

Then came the war.

From an economic point of view World War II was, above all, a burst of deficit-financed government spending, on a scale that would never have been approved otherwise. Over the course of the war the federal government borrowed an amount equal to roughly twice the value of G. D. P. in 1940 — the equivalent of roughly $30 trillion today.

Had anyone proposed spending even a fraction that much before the war, people would have said the same things they’re saying today. They would have warned about crushing debt and runaway inflation. They would also have said, rightly, that the Depression was in large part caused by excess debt — and then have declared that it was impossible to fix this problem by issuing even more debt.

But guess what? Deficit spending created an economic boom — and the boom laid the foundation for long-run prosperity. Overall debt in the economy — public plus private — actually fell as a percentage of G. D. P. , thanks to economic growth and, yes, some inflation, which reduced the real value of outstanding debts. And after the war, thanks to the improved financial position of the private sector, the economy was able to thrive without continuing deficits.

The economic moral is clear: when the economy is deeply depressed, the usual rules don’t apply. Austerity is self-defeating: when everyone tries to pay down debt at the same time, the result is depression and deflation, and debt problems grow even worse. And conversely, it is possible — indeed, necessary — for the nation as a whole to spend its way out of debt: a temporary surge of deficit spending, on a sufficient scale, can cure problems brought on by past excesses.

But the story of 1938 also shows how hard it is to apply these insights. Even under F. D. R. , there was never the political will to do what was needed to end the Great Depression; its eventual resolution came essentially by accident.

I had hoped that we would do better this time. But it turns out that politicians and economists alike have spent decades unlearning the lessons of the 1930s, and are determined to repeat all the old mistakes. And it’s slightly sickening to realize that the big winners in the midterm elections are likely to be the very people who first got us into this mess, then did everything in their power to block action to get us out.

But always remember: this slump can be cured. All it will take is a little bit of intellectual clarity, and a lot of political will. Here’s hoping we find those virtues in the not too distant future.

. . . . . . . . . . . and then there are a "limited" few who cannot think at all. They can only rely on cutting and pasting nonsense written by discredited so-called professional writers who write to please a small segment of the population who also believe in nonsense.